It's easy to get caught up in the numbers, especially during earnings season. Perhaps the most important point made by Precision Drilling Trust
First let's get through the obligatory ogling. Year over year, revenue was up 14%, while earnings were down, largely on account of stock compensation. The executive ranks have been shuffled at Precision, so this isn't an unusual outcome. Canadian drilling activity was off a hair, while U.S. activity was a multiple of prior-year levels. Precision's U.S. rig count has risen from five to 17 in that time.
The U.S. continues to be an extremely tantalizing market for the Canadian contract driller. With Petrohawk
Having the right rigs is important, but it's not enough. There's formidable competition from Helmerich & Payne
In the U.S., when a rig is redeployed to a different part of the country, the crew doesn't usually follow. Precision is sticking with the more standard Canadian practice of keeping the majority of crews together with their rigs, wherever that may take them. This may seem like a minor point, and even an unnecessary expense, but as Precision keeps ramping its U.S. presence, I think we'll see the practice bear fruit, as the company duplicates the industry-leading performance it has achieved up north.